To me, Fantasy means that anything goes. You could have a sprawling modern city inhabited by the traditional races found in most sterotypical fantasy novels, with domesticated dragons as a means of transport and i woulnt bash an eyelid at it. Anything goes, because its a fantasy, actually to be closer to the truth its your fantasy, your creation. Do what you would like to it. And worry about criticism later.
Ah then in theory it is could be used as an energy source or just about anything. In a way you could relate it to materia from final fantasy if I understand your meaning of empower correctly.
If I may make a suggestion, if you want to put guns into a fantasy setting, read up, if only on wikipedia, on the develpoment of gunpowder weapons. It will give you TONS of inspiration! But let me talk of something more profound.... The reason I love guns more than any other weapon, is that guns have had a PROFOUND effect on how societies conduct themselves. In the past, particularly in the Middle Ages, the best fighters (the knights and nobility) ruled with an iron first. The reason was simple: it took a lifetime to become proficient with a sword, or bow, the heavies of the pre-firearms battlefield. Even when the armies were not staffed with nobles (Roman legions), the professional soldiers where equipped with expensive swords and armor, and a peeved legion could overthrow the Senate, then the Emperors. The gun changed everything. By the time of Cortez, a peasant with two weeks of training on a primative musket could kill a knight who had armor expensive enough to buy another estate, a sword that was top of the line, and a lifetime of privledge and training. The French Revolution, and probably the American one too, could not have happened without low-born men with great eqaulizers in their hands to smite their would-be oppressors. I preceive the gun as the weapon of liberation, and equality. Peasants who can see they can kill their "betters" in one well placed shot are going to be a lot harder to control than peasants who think their lord's mastery of weaponry, horse and/or magic makes them unassailible. If you don't beleive me, read up on the Menjii Restoration in Japan, and see how fast a medievel society can change with an army of musket trained peasants. Guns are dangerous to mess with for these reasons. They can change the whole paradigm, and make it much harder for a society to remain in the midevel themes of traditional high fantasy. This is before and beyond what a steampunk industrial revolution could do. I would recommend though factoring in that magical armor might be something of an equalizer to the firearm...for those who can afford it and keep it. Just something to keep in mind. Hope this helps.
But Star Wars is all about fantasy and magic and throwing a laser swords against a laser pistol the size of Godzilla. Mixing genres would be a problem only if there is confusion about how that got in there in the first place.
Some of the best 'Fantasy' stories I find are those that don't have J.R.R. Tolken as a father, and C.S. Lewis as a mother. It is called 'Fantasy' for a reason, and I find it a sad aspect of the human race that we actually have a 'standard fantasy setting'.
